Time to put things into perspective Media Release

Apr 21, 2011 - 10:30pm

For around the cost of a sausage sandwich per week we can help Australia out of the world's biggest polluters club

The Climate Institute has today hit out at the campaign of misinformation being driven by vested business and political interests and is urging the issue of pollution costs be put in perspective.

“It’s high time we had some honest and balanced debate not just about the costs associated with putting a price on carbon pollution, but also the opportunities this important policy initiative will deliver for Australians,” said The Climate Institute’s CEO John Connor.

“No one denies there will be costs associated with transforming the Australian economy from one reliant on highly polluting industries to one based on cleaner energy and clean industries, but there are misleading claims being made,” he said.

“Whilst it’s understandable that a handful of vested interests might choose to put company profits or their own personal gain ahead of the interests of Australians, it’s disappointing the extent to which some have been willing to peddle misinformation to the community,” he said.

“Of particular concern is the fact pollution and clean energy policies have dishonestly been made the scapegoat for household electricity price rises, when in fact these rises are mainly the result of rising infrastructure costs,” he said.

Research released by The Climate Institute today details how electricity price rises are primarily being driven by the cost of network upgrades, and not the decision to put a price in pollution. 

The research also reveals Australia’s power sector ranks amongst the ten most polluting power sectors on the planet, alongside Botswana, Cambodia and Estonia, emphasising the need for Australia to get serious about transforming its economic base. This comes on top of figures released on Tuesday by the Department of Climate Change and Energy Efficiency that reveal Australia’s annual carbon pollution levels continued to increase in 2010.

“For around the cost of one sausage sandwich per week putting a price on pollution will help change the investment and power generation decisions necessary to help put Australia on the path to a low pollution, clean energy future,” he said.

“Most of us buy a sausage sandwich regularly to support important local community causes – this is no different. It’s about what relatively small amount of money we are willing to pay to reduce pollution for the benefit of our environment.”

“And the Federal Government has made clear there will be assistance provided to those lower income families who may struggle to pay the additional costs that result from making polluters finally start to pay for their pollution.”

“Let’s get real about this and put it in perspective. Unlike the other factors that are affecting electricity price rises, a pollution price will work to generate revenue from big polluters which can then be used to support energy efficiency, clean energy development and help low income communities manage the transition to cleaner energy in Australia.”

“Most importantly, making dirty power generators pay for their carbon pollution for the first time will then help drive investment in, and greater generation from, cleaner energy sources.” 

The Climate Institute’s factsheetInfographic and policy brief show that when compared to other factors a pollution price will have a relatively small impact of household energy bills.

A pollution price of $25/tonne will add around $3.86 per week to the average Sydney household’s energy bill in 2012/13.This is slightly higher than the amount estimated by Treasury, but a third less than suggested by the Coalition and some business groups. 

Rising network costs – which have nothing to do with a pollution price and will happen regardless – will have greater impacts at $7.88 per week.

Energy efficiency policies can further reduce the impact of pollution prices by at least $1.41 per week, reducing the difference to $2.45 per week. This is about the cost of a sausage sandwich at a local community fundraiser, or a fifth of the value of food wasted by the average household each week.

Other key facts on electricity prices:

  • Australia’s power sector ranks amongst the world’s top ten most polluting, along with countries such as Botswana, Cambodia, Bosnia-Herzegovina, Mongolia and Estonia.
  • Uncertainty in climate policy will cause electricity prices to rise by as much as 13 per cent by 2020 – that’s a $2 billion hit to the economy for nothing in return.
  • Failure to provide a more certain policy environment for investors will itself add an estimated $1.30 to the average household’s energy bill by 2020.
  • The 20 per cent Renewable Energy Target (RET) backed by both the ALP and the Liberal and National Parties accounts for a relatively small fraction of weekly energy bills – around $1.25 a week for the average Sydney household.
  • “There is no doubt there are challenging electricity price increases in the system, but the potential impacts and outcomes of pollution and clean energy policies needs to be put in perspective.”

“Pollution and clean energy policies can make a real difference to Australia’s pollution dependent economy and can help spark investment in our abundant clean energy resources,” said Mr Connor. 

For further information: 

John Connor | CEO, The Climate Institute |  0413 968 475
Harriet Binet | Communications Director, The Climate Institute |  02 8239 6299

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